Clinical trials of memory enhancing agents often demonstrate an improvement in cognitive outcome measures in the first one to two months in groups of subjects who received placebo. It is likely that some of this improvement is related to an expectancy or placebo effect. The goal of this developmental research is to develop a reliable, uncomplicated experimental model of placebo effect on cognitive function in older adults with and without AD, characterize this effect and estimate the effect size. We will also explore subject characteristics that may predict the effect and ways to increase the effect. 40 healthy seniors and 40 people with mild AD will be recruited for a study they are told is on the effects of an extract of Salvia officinalis on cognitive function. During part of the study, subjects will be given pills for 2 weeks that they are told is S. officinalis. Cognitive function will be compared between visits immediately following 2 weeks of pill taking and after 2 weeks of not taking any pills. The difference between the two conditions will be used as a marker for placebo effect. Cognitive assessments include standard clinical scales and well as more experimental measures. The study will determine if changes in cognitive function following administration of placebo correlate with: changes in mood and stress; self-efficacy as assessed by general and memory-specific self-efficacy scales; alertness as assessed by EEG and self-rated scales, and an electrophysiologic measure that relates to mental effort (the EEG frontal midline theta). We believe that some of the placebo effect is mediated through changes in alertness, mood, self-efficacy and mental effort that may be common mediators of the expectancy (placebo) effect. Additionally, we will explore whether positive feedback during cognitive assessments improves self-efficacy and whether self-efficacy alters placebo effects on cognitive performance. Lastly, we will explore whether there are predictors of who is most likely to demonstrate placebo effects by: genotyping for polymorphisms affecting neurotransmitter and other signaling systems potentially involved in the placebo effect; and assessing personality traits with self-rating scales and their possibly related electrophysiological markers, paying particular attention to those traits which have also been associated with these signaling systems.